The Stradivari violin known as 'The Hammer' sits on display at Christies auctioneers in New York May 11, 2006. An anonymous bidder paid $3.54 million for a Stradivarius violin made in 1707 at auction house Christie's on Tuesday, making it the most expensive musical instrument ever sold at auction, Christie's said. REUTERS/Shannon Stapleton

NEW YORK (Reuters) - An anonymous bidder paid $3.54 million for a Stradivarius violin made in 1707 at auction house Christie's on Tuesday, making it the most expensive musical instrument ever sold at auction, Christie's said.

The violin, known as the Hammer, was made by Antonio Stradivari in Cremona, Italy, during his "golden period," when he is believed to have crafted his finest instruments.

Before the sale, Christie's had estimated the Hammer's value at $1.5 million to $2.5 million.

The previous record belonged to the Lady Tennant, a 1699 Stradivarius that sold for $2.03 million at Christie's in April last year. Private sales have exceeded that price.

Of the more than 1,100 instruments Stradivari is believed to have made, only about 620 violins survive today, according to Kerry Keane, head of the musical instrument department at Christie's.